ISLAMABAD - Pakistan’s trade deficit has contracted by 5.59 percent in the first four months (July to October) of the current fiscal year.
The country’s trade deficit has decreased by 5.59 percent during the July-October period of this fiscal year. The trade imbalance, gap between exports and imports, was recorded at $6.97 billion as against $7.39 billion during the same period of last fiscal year. Pakistan’s exports have enhanced by 13.45 percent to $10.88 billion during the first four months of the ongoing financial year as compared to $9.59 billion in the same months of the last year. Meanwhile, imports increased by 5.17 percent to $17.85 billion during the July to October period of the year 2024-25 as compared with $16.977 billion in the same month of the last fiscal year.
The data further showed that the country’s trade deficit has narrowed by 17.69 percent on a month-on-month basis to $1.498 billion in October this year as against $1.82 billion in September. Exports have recorded 4.9 percent increase to $2.98 billion in October 2024 when compared to $2.836 billion in September 2024. On the other hand, the imports have recorded a 3.93 percent decline to $4.47 billion in October 2024.
The trade deficit has decreased by 31.09 percent on a year-on-year basis to $1.498 billion in October 2024 compared to $2.174 billion in October 2023. Imports have decreased by 8.02 percent on a YoY basis and remained $4.47 billion in October 2024 compared to $4.86 billion in October 2023. Exports have enhanced by 10.64 percent on a YoY basis and remained $2.98 billion in October 2024 compared to $2.69 billion in October 2023.
The ministry of finance had noted that external sector stability sustained during Q1 FY2025. Imports are reasonably increasing and providing impetus to economic recovery. Based on the currently observed trend, it is anticipated that in October 2024, the exports will remain within the range of $2.5-2.8 billion, imports $4.5-4.9 billion and worker’s remittances $ 2.8-3.3 billion.
The external account position improved due to notable increase in exports and remittances Sep FY2025, the current account deficit shrank to $ 0.1 billion compared to $ 1.2 billion last year. However, the current account recorded a surplus for the second consecutive month in September 2024. During Jul-Sep FY2025, goods exports increased by 7.8 percent, reaching $ 7.5 billion, while imports recorded at $14.2 billion, compared to $ 12.3 billion in last year (15.7% increase). This has led to a trade deficit of $6.7 billion, up from $ 5.3 billion last year. Foreign Direct Investment (FDI) stood at $771 million, 48.2 percent up from the previous year. The main contributors were China ($404 million), Hong Kong ($99 million), and the UK ($72.2 million). The power sector received net FDI of $416 million, accounting for a 54% share, followed by oil & gas exploration with $ 97 million (12.6% share). Moreover, Private Foreign Portfolio Investment (FPI) had a net outflow of $22.8 million, while Public FPI recorded a net inflow of $155.3 million. Workers’ remittances recorded the highest ever quarterly inflows of $8.8 billion, marking a 39% increase with the largest share from Saudi Arabia (24.5%). Pakistan’s total liquid foreign exchange reserves were recorded at $16.0 billion on October 18, 2024, with the State Bank of Pakistan’s reserves at $11.0 billion.
